![]() ![]() I immediately sent the link to our agent and told her that we’d love to look at it in a couple weeks when we went for house hunting leave (if it was still on the market). I looked at the listing date – January! It had been listed for nearly three months. The pictures looked inviting: simple, open, lots of green, and above average condition. Its price had recently been reduced from $925,000 to $895,000. I was doing my usual online search for Oahu homes and suddenly a 3 bedroom/2 bathroom home in Kailua appeared that I had not seen come up yet. That would be difficult in Kailua, because homes sell pretty fast, but nevertheless, I continued to focus on the amount of time a home was listed, because the longer a home was on the market, perhaps the seller would be more willing to contemplate a lower offer. One of the house hunting strategies I had was to look at homes up to $900,000 that were on the market for more than a couple months. Again, we’d be going all in with BAH and COLA. Purchase Price ($860,000) – (Down Payment) $41,062 = Base Loan Amount of $818,938Īfter calculating, that would give us about a $4,100/month mortgage payment with the VA’s benefit of no mortgage insurance required.Then, subtract the down payment requirement from the purchase price and get the “Base Loan Amount”: Since the VA will guarantee 25% of the total loan amount, we would need to cover 25% of the difference shown above: Honolulu County VA Loan Limit in 2012 = $695,750.We calculated that our comfortable max offer on a home would be $860,000 to leave us some home improvement funds.įor a VA Jumbo Loan, that down payment and financing scenario would look like this: Now that we were headed over the VA loan limit price, we had to look at the VA JUMBO LOAN option which required a down payment. We continued looking, but increased our search to homes around $900,000. Was it worth going “all in” with BAH and COLA to get the type of home we wanted? We decided that it would be, if we found something that we considered our perfect investment. If we used both BAH and COLA, that would give us a monthly mortgage payment of $4,268 and an estimated home price of $850,000 at a 3.75% interest rate.At the time, COLA was roughly $1,100 per month. ![]() We’d have to consider using COLA (Cost of Living Allowance).So, how could we afford a higher mortgage payment with a current BAH of $3,168? What they told us was exciting: due to our current financial situation, if we paid off our highest car payment, we could get pre-qualified for approximately $900,000. We called a VA loan lender to get pre-approved and pre-qualified. Personal note: I worked full-time before having kids, and we saved a large percentage of my paychecks each month and used the rest to pay off student-loan debt. We had a good chunk of savings for a down payment. ![]() We paid off any credit card purchases each month. We had a couple of good things going for us: How would we be able to afford a higher mortgage payment to get the kind of home we wanted? At an interest rate of 3.75%, that gave us an estimated single family home price of $617,000 – under the VA loan limit, but well under our desirable listing price range of $750K-$800K.
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